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I encourage everyone to watch this debate between Christopher Hitchens and Tony Blair on whether religion is a force for good in the world. I’ve watched Hitchens debate and speak on the topic of religion countless times and this might be his best performance.

Of course religion inspires people to do good works and to commit evil acts. Apologists like to point out all the good parts of the religious traditions – Sermon on the Mount, love thy neighbor, etc – while opponents point out the barbarous portions – Leviticus, Crusades, etc. I have no problem admitting that religion motivates acts of compassion and no problem recognizing the cruelty religion animates. The trouble with religion is precisely the nature of that malleability. The traditions, texts, rites, and dogmas are still part of a set – you get the good and the bad yoked together pulling the fracturing cart where you sit. Reason works differently: there are good ideas and bad ideas. Do nonreligious people commit acts of wickedness because of nonreligious reasons? Of course. But as reasonable people we’re free to reject bad ideas in favor of good ones.

Faith in any religion (or secular ideology) makes it impossible to successfully arbitrate between the epistemological truth of one interpretation over another. Not only that, but the more faithful one is to these ancient texts cruelty often becomes easier to justify. Apologists like Tony Blair believe his peaceful and tolerant form of religion is true, but he has no recourse in faith to undermine more extreme strains. God, for some reason, seems content to remain mute. By contrast, ideas held by reason are amenable to correction in light of new evidence and argument.

You might be tempted to counter that religious people ignore the bad bits in their religion despite, for example, the bible reminding Christians that every jot and tittle of the word of God should be fulfilled and Muslims believing the Quran is the perfect unalterable word of the Creator. Certainly the religious often neglect to carry out every commend of their holy book, but notice that it is precisely because they are dismissing part of their religion that the religion becomes more benign. I’m always surprised how often religions’ apologists argue that people doing good by ignoring religion shouldn’t be counted as a strike against religion.

Not being religious doesn’t compel a secular thinker to repudiate the positive messages found within religious texts. I need not refuse to be a good samaritan. I need not rebuke the poetry of the Bhagavad Gita. I need not rebuff non-violence because it is practiced by the Jains. Inspiration can be drawn from Shakespeare or Dickens, from Bentham or Kant, from Jesus or the Buddha. Skepticism just repels treating any book as inherently superior or moral. It is a component of religion that appraises its message as unearthly. Admit it or not a religion is, among other things, a set of beliefs supposedly divinely inspired. Once someone accepts that a set of beliefs came from God or from a prophet of God only skepticism of those beliefs or our innate and culturally formed compassion can temper any of the pernicious dogmas of that faith.

Religion cleaved from its superstitions and creeds is not religion. If you insist that you are still a Catholic if you don’t believe in Catholic dogmas, the divinity of Jesus, or the holiness of the bible you’re not actually religious. You might identify with that culture, but that’s not religion. It’s for that reason a Jewish atheist, for example, isn’t an oxymoron. Subverting the supernatural need not crumble our communities.

So ask yourself, would the world be better off if people became more religious or more reasonable?

Small government advocates need to make a choice. Do they prefer lowering taxes or reducing the size of government? Confronting the common myth, Bruce Bartlett explains cutting taxes does not “starve the beast.”

When Bush took office in January 2001, we were already well into fiscal year 2001, which began on Oct. 1, 2000. He immediately pushed for a huge tax cut, which Congress enacted. In 2002 and 2003, Bush demanded still more tax cuts, even as the economy showed no signs of having been stimulated by his previous tax cuts. The tax cuts and the slow economy caused revenues to evaporate. By 2004, they were down to 16.1 percent of GDP. The postwar average is about 18.5 percent of GDP.

Spending did not fall in response to the STB [starve the beast] decimation of federal revenues; in fact, spending rose from 18.2 percent of GDP in 2001 to 19.6 percent in 2004, and would continue to rise to 20.7 percent of GDP in 2008. Insofar as the Bush administration was a test of STB, the evidence clearly shows not only that the theory doesn’t work at all, but is in fact perverse. (my emphasis)

When tax cutters decouple spending and taxes they artificially decrease the cost of government services and consequently increase the demand for those services. That is why I favor linking specific taxes to corresponding spending programs that need more constraint. For example, I’ve argued that a ﻿VAT tied to healthcare spending﻿ would be the most effective way of controlling costs. Additionally, policies like PAYGO attempt to ensure the cost of government programs will be accurate. The Republican Party – a party dedicated to cutting taxes, not small government – wants to replace that with CUTGO, which should upset anyone that actually cares about the deficit. How do “small government conservatives” expect citizens to vote for fewer services if they don’t feel like they’re even paying for them? I don’t know many people that turn down “free” benefits.

The more directly people experience the cost for a service the less they’ll demand it (unless they feel it’s truly worth it). This is why Milton Friedman allegedly came to regret helping create the income tax withholding system. Here’s Austrian/libertarian thinker ﻿Murray Rothbard﻿,

One of Friedman’s most disastrous deeds was the important role he proudly played, during World War II in the Treasury Department, in foisting upon the suffering American public the system of the withholding tax. Before World War II, when income tax rates were far lower than now, there was no withholding system; everyone paid his annual bill in one lump sum, on March 15. It is obvious that under this system, the Internal Revenue Service could never hope to extract the entire annual sum, at current confiscatory rates, from the mass of the working population. The whole ghastly system would have happily broken down long before this. Only the Friedmanite withholding tax has permitted the government to use every employer as an unpaid tax collector, extracting the tax quietly and silently from each paycheck. In many ways, we have Milton Friedman to thank for the present monster Leviathan State in America. (my emphasis)

So the best way to get smaller government might just be to increase taxes so they reflect the true cost of programs. It’s possible if people are getting beneficial services they might just be willing to pay more for them – but in a democracy people get what they vote for: if we choose to pay for something it’s harder to argue we shouldn’t have it. At least we wouldn’t be running unsustainable deficits or passing off the cost of our benefits to others.

Tax cutting ideologues need to understand that if you cut taxes without cutting a corresponding amount of spending that doesn’t permanently lower taxes, it shifts them to the future. Just as if I purchase a $200 TV but only have $100 in my checking account, I still owe another hundred bucks – I’ll just have to raise that money later and then pay back whoever I borrowed the initial money from. Low taxes now with high spending just results in higher taxes later. If you want low taxes and small government, you need to cut spending first. Only when our “cost of living” is lower can we afford to lower our income.

Small government advocates must confront reality: making government seem cheaper will never convince Americans to choose less of it.

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Whenever evaluating policies, I find it useful to form a logical model in my mind of how different scenarios should plausibly work out. Doing so requires I walk through various alternatives through their logical steps. I hope some Socratic questioning can be illuminating for us.

Questions for inflationists:

Do you think inflation, currently at historical lows, would be higher, lower, or the same had we not used fiscal stimulus and the first round of quantitative easing?

The Fed has already loosened monetary policy and previously tried the first round of quantitative easing which expanded the money supply in the economy. The Bush and Obama administrations expanded the money supply through fiscal stimulus. Presumably we’d have lower inflation had those policies not happened. At 0.6% annual increase in CPI, wouldn’t deflation have been a likely possibility?

Given all their rhetoric about soaring inflation and the dangers of flooding the economy with cheap money, you’d think they’d answer it’d be lower. But if it was any lower it’d be outright deflation.

Finally for all those worried about the dangers of printing money to fight off potential deflation, what would the inflation picture have to look like for you to argue that the government or the Fed should add more money into the economy?

Questioning uncertainty:

There is no doubt that there is uncertainty in our markets. Advocates of fiscal and monetary stimulus are under no obligation to deny that uncertainty can negatively affect the economy. In their popular Keynesian book, ﻿Animal Spirits﻿, George Akerlof and Robert Shiller approvingly quote Washington Post writer Anna Youngman from the Great Depression:

At present, Mr. Dupont [president of the chemical company] notes, there is uncertainty about the future burden of taxation, the cost of labor, the spending policies of the Government, the legal restrictions applicable to industry-all matters affecting computations of profit and loss. It is this uncertainty rather than any deep-seated antagonism to governmental policies that explains the momentary paralysis of industry…

If it actually exists to the level some conservatives now say it does (I’m still waiting on the evidence: here and here), how far does this etherial “uncertainty” go? And to what extent should it affect our policy decisions?

This is how I come at the question. Currently aggregate demand is very low. Small businesses are reporting in greater numbers that “poor sales” is a major problem. Personal consumption and retail sales remain low.

Earlier last year government consumption was offsetting some of the drop in private consumption, but as fiscal stimulus fades that has also dropped off.

So imagine you own a company that produces shoes. You’re uncertain how different legislation will affect your future costs – you may believe your taxes could go up, so maybe you shouldn’t hire another worker despite receiving lots of applications. You’re making decent money now and your workers are producing more than enough shoes to satisfy their current customers. You have plenty of excess capacity to make more shoes but, since labor costs a lot (healthcare, taxes, salary, training, etc) you may even be keeping your workers’ hours fairly limited and may even cut back. I think that largely encapsulates the uncertainty picture for a business.

Now let’s assume that all of a sudden there is a big spike in demand for your product (which is what stimulus advocates want to create). You’re selling your supply out. There is NO CHANGE in healthcare legislation, tax rates, labor costs, and shoe material costs, although you’re still uncertain about the future of those costs. If you were the shop owner, can you imagine yourself still not hiring new workers if doing so would be the only short-term way you could satisfy the increased demand for your product?

I submit that businesses aren’t going to forgo making more money now to sell customers more of what they want because they are “uncertain” about various potential future problems. This scenario doesn’t suggest that uncertainty doesn’t matter at all; it just suggests that when looking at the policy prescriptions it seems to have little value for our short-term unemployment crisis.

Now consider another scenario. You’re a business owner that has poor sales, but the congress decides to repeal the healthcare bill, permanently continue all the Bush tax cuts currently in place, cut unemployment benefits, cancel any unspent stimulus money, downsize the federal employment roles, and will promise not to add any new regulations on business. Furthermore, the Fed decides not to add any more money into the economy.

I can’t prove that businesses wouldn’t upon hearing this news and rush out and hire lots of new workers, but let’s just say I’m skeptical of how strong that changes the incentive of businesses to hire new workers.

In our economy we have poor sales and, according to many, policy uncertainty created by the Obama administration and the Fed. In scenario 1, there are poor sales and uncertainty. If poor sales change to strong sales while uncertainty continues, it seems businesses will still hire new workers. In scenario 2, there are poor sales and uncertainty. Nothing was done to directly shift demand rightward by increasing consumption, but some supply side and other right-wing wishes were granted. So we supposedly tackled “uncertainty” but not sales. I personally don’t see how that clearly answers the unemployment problems in our economy. Yet this is the position of some on the political right (via Kevin Drum).

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If I’m going to call out others for being wrong I may as well call out myself. I didn’t write much on the subject; just a quick link to a column by George Will I enjoyed and this, “GM was too big to fail so the American taxpayer gets to waste money on cars that no one wants to buy.”

I’m probably lucky I wasn’t blogging as much back then. I hadn’t thought that much about the issue, but I assumed it was foolish to bailout GM. I’ll do my best to wipe the tire marks off myself.

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I always considered a bit of intellectual cowardice from myself to not fully consider and acknowledge the cruelty that one is responsible for when eating meat. I eat meat and I have no strong case for not abstaining from eating meat, but I do hope and expect that our farmers (and their regulators) at least attempt to minimize the suffering of these animals as much as possible. Most people, I imagine, are with me in the belief that we shouldn’t purposefully slaughter animals with methods that needlessly increase pain and terror. Yet, as Johann Hari explains, we allow exactly this to happen if the butcher wants to appease an invisible deity.

There’s a good example of this religious modus operandi playing out on a dinner table near you – and this week, we found out it is becoming more and more common. In Britain, it is a crime to kill a conscious cow or sheep or chicken for meat by slashing its throat without numbing it first. The reasons are obvious. If you don’t numb an animal, it screams as you hack through its skin, muscle, trachea, oesophagus, carotid arteries, jugular veins and major nerve trunks, and then it remains conscious as it slowly drowns in its own blood – a process that can take up to six minutes. So we insist that an animal is stunned before its throat is slashed, to ensure it is deeply unconscious. There isn’t much humanity in our factory farming system, but this is – at least – a tiny sliver of it, at the end.

But there is a loophole in the law. You are allowed to skip all this and slash the throats of un-numbed, screaming animals if you say God told you to. If you are Muslim, you call it “halal”, and if you are Jewish you call it “kosher”. Back in the Bronze Age, or the deserts of sixth-century Arabia, it was sensible to act this way. You needed to know your meat was fresh and the animal was not sick, so you made sure it was alive and alert when you killed it. As Woody Allen once said, it wasn’t so much a commandment as “advice on how to eat out safely in Jerusalem”. But we have much better ways of making sure meat is fresh and healthy now. Yet for many religious people it has hardened into a dogma, to be followed simply because it was laid down in their “holy” texts long ago by “God”.

I get if you want to follow some sort of traditional diet in order to impose discipline on yourself or you just enjoy the sense of connection customs can bring. But there are plenty of customs that can be practiced without torturing animals. Also, what kind of God is it that would continue to mandate such a practice in the 21st century?